June 16, 2009 / 5:20 PM / 10 years ago

UPDATE 2-Cargill canola meal eyed after salmonella test

* Salmonella found in Cargill canola meal

* Meal traced to Clavet, Saskatchewan plant

* FDA applying higher scrutiny to Cargill shipments

* Canola industry studying salmonella problem (Adds industry and market reaction)

By Rod Nickel

SASKATOON, Saskatchewan, June 16 (Reuters) - Cargill [CARG.UL] shipments of Canadian canola meal into the United States face more scrutiny after salmonella was found in a shipment this winter, a U.S. Food and Drug Administration document shows.

Cargill’s plant in Clavet, Saskatchewan, crushed the contaminated canola meal, according to an FDA import refusal report. The FDA could not say when the contaminated shipment was detected at the U.S.-Canada border, but the report dates Cargill’s import alert status as March 11.

That status signals FDA inspectors to pay special attention to Cargill products. The FDA could not say if the alert applies only to canola meal or a broader range of Cargill products.

Import alert status signals to inspectors that the FDA has enough evidence to warrant refusing admission to the United States without physical inspection of the goods.

Companies under import alert status must provide results of third-party lab tests proving the products are free of salmonella with its shipments to the United States, said FDA spokeswoman Rita Chappelle.

Cargill spokesman Robert Meijer said salmonella concerns are an industry issue, not one limited to the company.

“As an industry, we are working with FDA to resolve their concerns,” he said in an email.

Cargill is one of two Canadian canola crushers facing U.S. border restrictions because of salmonella. Two rail car shipments of canola meal from Bunge Ltd (BG.N)’s Canadian crushing plants tested positive in May for salmonella.

Canola, a variant of rapeseed, is crushed for its oil, creating a meal byproduct used as animal feed.

The Canadian Oilseed Processors Association (COPA) said Friday that the FDA has recently imposed higher standards for salmonella testing in agricultural products. But Chappelle said nothing has changed.

“When we test product and it has salmonella, it can’t come into the country,” she said in an email.

Once a company’s product tests positive for salmonella, it must file a corrective action plan for review by the FDA, Chappelle said.

Bunge shut down the canola lines at its Hamilton, Ontario, and Nipawin, Saskatchewan, plants after the FDA found salmonella in two canola meal shipments in May. Each plant is now undergoing scheduled cleaning.

Cargill’s Clavet plant has slowed production but that’s due mainly to its ongoing expansion, not salmonella detection, said Bob Broeska, president of the Canadian Oilseed Processors Association. Despite the fact three Canadian plants have now slowed or halted production, there doesn’t appear to be a problem yet with a shortage of crushing capacity, Broeska said.

A team of industry officials from within the processors association is now studying Canadian plant procedures and the FDA’s standards to prevent further salmonella detection, Broeska said.

With the canola meal of two companies now detected for salmonella contamination, the broader concern is that it could overhang the canola industry, said Dave Hickling, vice president of canola utilization for the Canola Council of Canada.

“There’s always a risk that the situation can get out of control. That’s why it’s important to keep everything in balance. I don’t detect any sense of panic at this stage.”

The ICE Winnipeg canola futures market <0#RS:> closed almost 1 percent lower on Tuesday, with one trader saying news of salmonella in Cargill’s canola meal was among several bearish factors that turned the market lower.

People who eat food contaminated with salmonella can become ill with salmonellosis, a food-borne illness with flu-like symptoms.

Editing by Lisa Shumaker

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